West Coast Main Line

Paul Farrelly Excerpts

Monday 15th October 2012 Commons Chamber

[Mr McLoughlin]

I hope we see no delays in investments as a result, and I am always grateful to my hon. Friend, who is always trying to be helpful.

[Paul Farrelly (Newcastle-under-Lyme) (Lab)]

FirstGroup’s bid included a £190 million guarantee, which would in no way have been large enough to compensate the Government if its optimistic bid had failed to deliver the goods—in fact, it gave a strong financial incentive to walk away. Has the Secretary of State yet understood why that basic feature did not set alarm bells ringing before the bid was announced? Will he ensure that future contracts contain no financial incentives for bidders to walk away?

[Mr McLoughlin]

The time that bidders walked away was under the previous Government, when the operators on the east coast main line did so. There are lessons to be learned. I shall not prejudge what the inquiries might tell us, but I am looking forward to their results and hope that we can then move on based on a safer footing.